Will 2026 Be the Year That Crypto Finally Goes Mainstream?

Looking at cryptocurrency prices, market sentiment, and headlines, you could be forgiven for thinking that the blockchain sky is falling. Since the start of October, the overall market cap for crypto has fallen from $4.2 trillion to $2.9 trillion. And that's extremely unsettling for investors in these assets. However, the cryptocurrency industry also took some steps toward mainstream adoption in 2025 that would have been unthinkable five years ago.

Image source: Getty Images.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now, when you join Stock Advisor. See the stocks »

The U.S. government announced a plan to begin including Bitcoin (CRYPTO: BTC) in its strategic reserves. Lawmakers passed a clear legislative framework for stablecoins. U.S. financial regulators started to take a pro-crypto approach, dropping charges against crypto backers that previous appointees had viewed as rule-breakers. Bitcoin's price set new highs, and traditional financial institutions introduced new crypto products.

Those changes may have set the scene for cryptocurrency to take off in 2026.

Will crypto go mainstream in 2026?

There are lots of ways to define mainstream, but at heart, it's about a product or service being recognized and widely used. Cryptocurrency has a lot of recognition -- so much so that you may find yourself discussing it with relatives during the holiday season. However, wide adoption is still a work in progress.

Here are three key drivers that could have the potential to embed crypto more actively into our daily lives in 2026.

1. Stablecoins

If people start using stablecoins as a preferred payment method, you wouldn't only be talking about crypto over a holiday meal -- by Christmas 2026, you might have used it to buy the food you're eating. Stablecoins are essentially tokenized versions of existing currencies, such as the U.S. dollar. They offer the possibility to make almost-instant payments anywhere in the world for a tiny fee.

The amount of money held in stablecoins has surged since the Guiding and Establishing National Innovation for U.S. Stablecoins Act -- otherwise known as the Genius Act -- became law in July because there's now a clear, compliance-friendly way for banks and payment processors to use them. Next year, we will likely see stablecoins move from primarily a crypto trading tool to a mainstream payment rail. A McKinsey report suggests the value of stablecoins in circulation could grow from $250 billion in 2025 to $2 trillion by 2028.

2. Real-world asset tokenization

Real-world asset (RWA) tokenization is a way to capture ownership of anything from equities to intellectual property on the blockchain. That's a powerful idea. It takes some of the friction out of trading. Plus, it can make assets such as real estate or private equity more accessible. That applies to both the type of asset and the minimum amount one needs to get started in investing in them.

For example, fractional shares of stock have become commonplace, but it wasn't so long ago that they were a new innovation that transformed retail investing, making pricey equities accessible to more investors. Imagine applying the same concept to the ownership of a piece of art or real estate, breaking it into an unlimited number of tiny and easily traded pieces. You could also automate things like dividends or other payments.

There's still progress to be made, both in terms of technology and regulation. However, tokenization is already taking off. According to rwa.xyz, there was less than $2 billion in RWA at the start of 2024. Now there's more than $18 billion, with almost half of that in tokenized U.S. Treasuries. In 2026, the ownership of even more assets will move onto the blockchain.

3. Growth of crypto ETFs and inflows of institutional money

Clearer regulations and increased confidence in digital assets have both paved the way for increased inflows into crypto from institutional investors. The range of crypto investment products is growing rapidly, and you can now access popular altcoins or a selection of cryptos through spot exchange-traded funds (ETFs). It's also easier than ever to include Bitcoin in 401(k) savings plans, though questions remain about the merits of including high-risk assets in retirement accounts.

Institutional investment in crypto, particularly Bitcoin, has been a major driver during the past two years. Total net assets in spot Bitcoin ETFs have soared from about $30 billion shortly after they launched in January 2024 to almost $125 billion today, per Coinglass data. Although Bitcoin's rapid price slump has caused some institutional outflows in recent months, that trend isn't as drastic as some might expect.

Indeed, a recent Bernstein report suggested "sticky" institutional cash might help Bitcoin reach new highs in 2026 and 2027. According to State Street Investment Management (NYSE: STT), 86% of institutional investors either owned or planned to buy Bitcoin in 2025. That trend looks likely to continue in 2026.

2026 could be another transformative year for crypto

The recent pullback in the crypto market shows that it's still a risky asset class. Cryptocurrency is a relatively new industry, and many things could happen to throw its progress off course, from technical glitches to regulatory impediments. That's why crypto should only make up a small percentage of your portfolio, no matter how exciting its prospects may seem.

All the same, we might look back at 2025 as the year crypto shifted from a fringe asset to a legitimate asset. The themes in this article are not new. What is new is that they seem to have gained enough momentum to deliver on their potential. As a result, 2026 may be the year that crypto comes into its own.

Emma Newbery has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin. The Motley Fool has a disclosure policy.